Which Direction To Take

I have in the past year upgraded my CD player (Cambridge Audio Azur 740C), Universal Player (NAD T585), Speakers (Monitor Audio Silver RS-6/RS-1/RS-LCR, speaker cables (Kimber 8TC), audio interconnects (Cardas Quadlink-5), digital interconnects (Kimber DV-30) and power cables (Kimber PK-10 power side and IsoTek source side). I am keeping my subwoofer (REL Q150e) and Power Conditioner (Audio Prism Phase III). So I am left with upgrading my power and processing. I currently own a Denon AVR 3805.

My dilemma is that my usage is at least 90% music but I must keep a home theater system active (to keep the peace) and I do enjoy some multichannel SACD and DVD-Audio listening. I have wanted to go to separates for two reasons, better audio performance generally accepted as coming from separates and the thought that a good amplifier can last for years and that the processing is what seems to change the most (i.e. video formats and switching, audio decoding, HDMI, etc.). My system is very modest/mid-line (but I do enjoy it) and there are a lot of choices for quality AVRs for a budget of $2500 but very little in the way of separates other than maybe Rotel and NAD that would fit into this general budget target.

Any suggestions or recommendations on the direction to go given my existing system components, application needs and budget? Should I try to move to separates or stay with an AVR?

Thanks for the feedback.